First American Financial Corporation (FAF) — Fundamental Analysis & Key Financial Ratios

Kaplio overview: First American Financial Corporation

Market cap $7B · 52 weeks $57 – $79 (20 % below the high) · P/E 8.9× · 2027 expected P/E 9.4× · Dividend 3.6 % · 11 years rising · Next earnings February 10, 2027 · expected EPS $1.81 · Closing price, Oct 28 · accounts published Oct 21.

• Valuation: P/B 1.2× (justified).
• Business: 5-year op. margin 8.1 % (weak).
• Balance sheet: Debt/Equity 0.47 (fragile).
• Earnings: 5 of 8 (uneven).

What would it be worth at its usual multiples?

At a P/B justified by its ROE del 13,3 % (1.5×) $79 (+24 %); at its peers' median (1.2×) $62 (-3 %). Implied price from applying the reference multiples to today's earnings (or book value, or FFO) per share. Not a fair value: it is where the stock would trade at its usual multiples.

What matters in insurance: 2 of 5 pass

• Op Margin 5y (Combined Ratio proxy) 8.1 %, fails.
• Book Value / Share growth 4.0 %, fails.
• Debt / Equity 0.47, fails.
• P/B (Price / Book) 1.2×, passes.
• Dividend growth streak 11 años, passes, near the threshold.

Against its peers (reference peers) — First American Financial Corporation: P/E 8.9×; P/B 1.2×; ROE 13.3 %; $6.5B. Enact Holdings Inc. (P/E 10.1×; P/B 1.2×; ROE 12.8 %; $6.6B), Essent Group Ltd. (P/E 9.2×; P/B 1.0×; ROE 11.9 %; $5.9B), MGIC Investment Corporation (P/E 8.8×; P/B 1.2×; ROE 13.9 %; $5.8B).

Expensive or cheap against its last ten fiscal years?

Precio / valor contable at each close: today 1.2× · median 1.4× · minimum 0.8× · maximum 2.3× · cheap below 1.3× · expensive above 1.7×. It has been cheaper than today only 17% of the time over its last ten fiscal years.

Dividend

solid · Yield 3.6 % ($2.16 per share in 2025) · Years raising it ≥ 11 · 5-year growth +4 % a year · Free cash flow coverage payout 36 % · With $1,000 invested today you'd collect $35.60 a year ($2.97 a month).